The Canadian economy ended 2020 on a surprisingly good note and momentum is carrying into the new year, the latest evidence that growth is poised for a staggering rise in the coming months as pandemic restrictions are phased out.

Real gross domestic product grew 2.3 per cent in the fourth quarter, or by 9.6 per cent at an annualized pace, Statistics Canada said Tuesday. That was well ahead of expectations. Still, the economy shrank 5.4 per cent in 2020, the worst annual reading in decades.

Heading into Tuesday’s release, the fear was that economic activity would contract in January, given ample restrictions to contain the second wave of COVID-19. However, Statscan estimated that real GDP grew by 0.5 per cent that month, accelerating from a meagre 0.1-per-cent gain in December, on strength in construction and manufacturing.

Source: The Globe and Mail